Make Technology Transformational, Not Transactional

By Yasmin Belkhyr

September 25, 2024

Technology has reshaped the philanthropy sector over the last 30 years, and new innovations continue to drive the evolution of technology’s place in grants management. To help grants management professionals better navigate the ever-changing technological environment and opportunities, PEAK Grantmaking joined Grantbook and the Technology Association of Grantmakers (TAG) to discuss learnings from the sixth edition of A Consumers Guide to Grants Management Systems for Public and Private Foundations. The guide is a collaborative effort from the three organizations and Tech Impact to create a comprehensive resource that identifies, compares, and evaluates the most requested and prioritized features across 14 popular grants management systems.

The launch webinar featured subject matter experts from each organization who shared insights on the landscape of grants management systems (GMS), how organizations can best equip and employ GMS for greater impact, and how technology can enable equity-centered and values-driven philanthropy. Below, we share some highlights and key takeaways from the panelists—PEAK’s Dolores Estrada, Grantbook’s Tierney Smith, and TAG’s Jean Westrick—in a conversation moderated by Amadie Hart.

What to Consider Before Making a Change

Selecting a new grants management system—or even deciding if you need to switch—can be a difficult, expensive and time-consuming process. Most organizations stick with their GMS for around 5 years before considering a change, and just 25 percent of grants management professionals surveyed for the guide said they were actively looking for a new grants management system. When determining whether transitioning to a new system might be necessary, it’s essential to think deeply about the pain points you’re experiencing with your current system and identify where that friction lies.

“Organizations need to distinguish the problem they’re facing,” said Smith. “Is your existing GMS fundamentally at odds with who you are and where you want to go, or are the issues rooted in your organization’s processes or how the GMS has been implemented?”

Though technology is an important tool, Westrick noted that it’s simply not a silver bullet. Despite the excitement of a fresh start, moving to a new system without addressing the organizational or process challenges that prompted a switch will only lead to those same frustrations down the road. Before jumping ship to a shiny new GMS, consider partnering with your IT and vendor partners to work out kinks in functionality and better configure your GMS to fit the needs of your staff and community. And whether or not you’re considering a move, incorporating regular check-ins and reviews of your GMS is crucial to ensuring it’s still serving the diverse needs of your staff, partners, community, and mission.

Your technology investments are an investment in your strategy.

Spending more time, energy and resources on bolstering your technological infrastructure and aligning your tools to your needs is always a good thing. The 2022 State of Philanthropy Tech Survey found that half of foundations allocate just 5 percent or less of their operating budgets to technology. Identifying and utilizing the right technological tools is vital to achieving equitable and impactful grantmaking, especially as the landscape and sector rapidly shifts with the introduction of AI-powered software. The dramatic societal and technological changes of the last few decades have made one thing clear: nonprofits and grantmaking organizations that invest in and leverage technology are more effective than those that don’t.

“Your technology investments are an investment in your strategy,” said Westrick. “You need to have the technological infrastructure to lead to the impact you want to create. Instead of seeing your GMS as a utility like a light bill, think of it as a strategic enabler that moves your mission forward.”

Patience and Inclusivity are Key to Choosing a New System

A GMS is a virtual concourse of your organization’s work and processes. From nonprofits to grants managers, to IT, programmatic and even accounting staff, there’s a diverse range of people who interact with an organization’s GMS on a daily basis. This is why it’s essential to carefully weigh your options—and the unique factors and needs of your organization—before committing to a new system.

If it turns out that your organization has outgrown your legacy GMS, Smith recommends developing a structured decision-making process that empowers stakeholders to reflect on their core technology needs. It’s also important to understand the level of complexity you’re looking for in a GMS in order to find the right match.

“There are systems that are beautifully simple, which is amazing if that meets your needs, and there are systems that will give you the world in options to tailor to your unique way of working—but, you’ll spend a world of resources customizing it, whether that be time or money,” Smith explained. “It’s crucial to be realistic about where you are on that scale.”

Committing to a new GMS is a serious decision that should not be rushed—it is a critical touchpoint for your staff, community partners, and grantees, all of whom will be affected by this change. Take the time to collect feedback from internal and external stakeholders, and assess how your new GMS can help narrow the power gap between your organization and the nonprofits and community you serve.

Technology is much more than technology—it really comes down to a reflection of our values.

Vendor alignment is crucial as well. “Ensuring your vendor shares your values, understands the functionality you need and is willing to evolve with you is key to developing a strong partnership,” Smith said.

These factors should all play a role in determining which GMS is right for your organization. Considering the importance of a GMS and the significant resource investment required to fully implement a new system, organizations need to do their due diligence before embarking on the long (and rewarding) road of inaugurating a new GMS.

Technology as a Tool for Equity

Grants management systems are the vehicles through which grant-making organizations organize and operationalize their work—but they can also be tools of accessibility, trust and equity.

“Technology is much more than technology—it really comes down to a reflection of our values,” said Westrick. “The guide allows folks to deeply reflect on the processes they’re trying to sharpen so that we can live and practice our values, and understand which partners will help us get there.”

A Consumers Guide to Grants Management Systems for Public and Private Foundations incorporates PEAK’s five Principles for Grantmaking to help organizations factor their values into their technology infrastructure calculus.

When you tie your values to your practices, those values are represented in the technological tool that you’re using.

“The guide gives us insight into how our systems can work for the benefit of funders and grantees by moving us closer to mutually-aligned, values-driven, equitable grantmaking tools. When you tie your values to your practices, those values are represented in the technological tool that you’re using,” said Estrada. “The beauty of the principles is that you can use them at whatever point in your journey you’re in: there’s a path forward to operationalizing our values through the tools that we’re implementing.”

The technology tools available to the philanthropy sector have dramatically expanded; there are more systems on the market than any one grants management professional could realistically review. The Consumers Guide to Grants Management Systems offers grants management professionals a way to filter through baseline criteria but ultimately, each organization’s needs and values are unique, and the market has responded to provide a variety of solutions to meet that demand. This bevy of options both enables and challenges grants management professionals to change how they understand and utilize technology to create more balanced relationships between themselves and nonprofits, lift administrative burdens for grants management professionals, advance funder and nonprofit missions, and create greater impact.

“We’re seeing shifts in philanthropy and in the world that help us drive this new way of looking at technology as a transformative—not transactional—piece of how we do business,” Estrada added. “2024 is representative of the birth of technology as an asset to philanthropy.”

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